“Most institutionally-minded crypto firms want to buy proper insurance, and in many cases, getting adequate insurance coverage is a regulatory or legal requirement,” he told the publication, continuing:

“However, getting such coverage is almost impossible, despite their best efforts.”

The paradox is made more painful by investors’ persisting high levels of interest in getting into the space, Reuters adds, quoting a September survey that placed such interest at 72 percent among institutional investors.

Following a year of heavy losses for participants and issuers of initial coin offerings (ICOs) in particular, investment and long-term prospects of crypto operators has come under the spotlight once more.

At the same time, those involved in funding crypto businesses, such as cryptocurrency merchant bank Galaxy Digital, maintain that the entry of institutional investors is both guaranteed and a major step to legitimizing the market.